Euro slips against the greenback following Spanish debt sale

Posted On: April 04, 2012
The value of the shared currency of the European Union scraped its lowest rate in 14 days against the U.S. dollar on Wednesday after borrowing expenses for Spain gained at an auction, according to Reuters.

The embattled monetary unit also fell in the aftermath of the release of minutes from the March meeting of the policy-making arm of the U.S. Federal Reserve, which strengthened the U.S. dollar. Discussion during the March 13 Federal Open Market Committee meeting indicated that monetary easing is not likely to happen anytime soon.

"The latest leg down today was on some slight disappointment in the auction, and (peripheral) yield spreads are wider as a result," head of global FX strategy Adam Cole with RBC Capital Markets told Reuters on Wednesday. "But the bigger picture decline in euro today is more about the rise in U.S. yields that came in the wake of the FOMC yesterday."

A Spanish auction saw the sale of 2.6 billion euros-worth of government bonds, which was lower than the target range. Spain's deteriorating public finances have become of concern as the sovereign debt crisis continues to roil regional economies.

Bloomberg reports the euro dropped to its lowest value in 21 days against the Japanese yen.

Category: Industry News

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